Reference no: EM13831007

1. What is the future value of $1,200 a year for 5 years at a 7 percent rate of interest?

1. The Great Giant Corp. has a management contract with its newly hired president. The contract requires a lump sum payment of $24,100,000 be paid to the president upon the completion of her first 9 years of service. The company wants to set aside an equal amount of funds each year to cover this anticipated cash outflow. The company can earn 8 percent on these funds. How much must the company set aside each year for this purpose?

1. You are considering an annuity which costs $73,600 today. The annuity pays $5,700 a year. The rate of return is 6 percent. What is the length of the annuity time period? (Do not round intermediate calculations.)
2. You want to have $44,000 in your savings account 6 years from now, and you're prepared to make equal annual deposits into the account at the end of each year.              Required: If the account pays 7.5 percent interest, what amount must you deposit each year?

1. Mr. Miser loans money at an annual percentage rate of 23 percent. Interest is compounded daily. What is the effective rate Mr. Miser is charging on his loans?
2. On the day you entered college, you borrowed $30,000 from your local bank. The terms of the loan include an interest rate of 4.75 percent. The terms stipulate that the principal is due in full one year after you graduate. Interest is to be paid annually at the end of each year. Assume that you complete college in four years. How much total interest will you pay on this loan assuming you paid as agreed? (Hint: This is simple interest, not an amortized loan
3. You just acquired a 30-year mortgage in the amount of $179,500 at 4.75 percent interest, compounded monthly. Payments will be equal over the life of the loan with the first payment due one month after the date of the loan. How much of the first payment will be interest?